Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Jul. 26, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | INST | |
Entity Registrant Name | INSTRUCTURE INC | |
Entity Central Index Key | 1,355,754 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 34,829,305 |
Consolidated Balance Sheets (un
Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 67,951 | $ 35,693 |
Short-term marketable securities | 48,588 | 5,697 |
Accounts receivable—net of allowance of $387 and $318 at June 30, 2018 and December 31, 2017, respectively | 93,841 | 34,312 |
Prepaid expenses | 10,079 | 11,492 |
Deferred commissions | 8,070 | 7,086 |
Other current assets | 2,010 | 2,419 |
Total current assets | 230,539 | 96,699 |
Property and equipment, net | 27,547 | 23,926 |
Goodwill | 12,354 | 12,354 |
Intangible assets, net | 7,609 | 9,048 |
Noncurrent prepaid expenses | 3,347 | 2,939 |
Deferred commissions, net of current portion | 11,108 | 11,160 |
Other assets | 537 | 497 |
Total assets | 293,041 | 156,623 |
Current liabilities: | ||
Accounts payable | 6,961 | 2,892 |
Accrued liabilities | 11,437 | 13,702 |
Deferred rent | 1,330 | 936 |
Deferred revenue | 129,860 | 99,773 |
Total current liabilities | 149,588 | 117,303 |
Deferred revenue, net of current portion | 2,666 | 1,889 |
Deferred rent, net of current portion | 10,643 | 9,201 |
Other long-term liabilities | 20 | 1,286 |
Total liabilities | 162,917 | 129,679 |
Stockholders’ equity: | ||
Common stock | 3 | 3 |
Additional paid-in capital | 378,485 | 250,899 |
Accumulated other comprehensive loss | (2) | (1) |
Accumulated deficit | (248,362) | (223,957) |
Total stockholders’ equity | 130,124 | 26,944 |
Total liabilities and stockholders’ equity | $ 293,041 | $ 156,623 |
Consolidated Balance Sheets (u3
Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 387 | $ 318 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue | $ 50,063 | $ 38,545 | $ 98,054 | $ 73,017 |
Cost of revenue | 14,598 | 11,055 | 28,583 | 20,735 |
Gross profit | 35,465 | 27,490 | 69,471 | 52,282 |
Operating expenses: | ||||
Sales and marketing | 24,841 | 18,972 | 48,029 | 37,199 |
Research and development | 14,849 | 11,057 | 29,509 | 22,239 |
General and administrative | 8,200 | 7,621 | 16,491 | 14,607 |
Total operating expenses | 47,890 | 37,650 | 94,029 | 74,045 |
Loss from operations | (12,425) | (10,160) | (24,558) | (21,763) |
Other income (expense): | ||||
Interest income | 529 | 39 | 767 | 115 |
Interest expense | (20) | (4) | (29) | (18) |
Other income (expense), net | (529) | 25 | (353) | 48 |
Total other income (expense), net | (20) | 60 | 385 | 145 |
Loss before income taxes | (12,445) | (10,100) | (24,173) | (21,618) |
Income tax expense | (93) | (168) | (232) | (251) |
Net loss | $ (12,538) | $ (10,268) | $ (24,405) | $ (21,869) |
Net loss per common share, basic and diluted | $ (0.36) | $ (0.35) | $ (0.73) | $ (0.76) |
Weighted average common shares used in computing basic and diluted net loss per common share | 34,491 | 29,090 | 33,444 | 28,909 |
Subscription and Support | ||||
Revenue | $ 45,104 | $ 33,713 | $ 88,304 | $ 65,267 |
Cost of revenue | 10,784 | 7,967 | 21,175 | 15,072 |
Professional Services and Other | ||||
Revenue | 4,959 | 4,832 | 9,750 | 7,750 |
Cost of revenue | $ 3,814 | $ 3,088 | $ 7,408 | $ 5,663 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (12,538) | $ (10,268) | $ (24,405) | $ (21,869) |
Other comprehensive gain (loss): | ||||
Net change in unrealized gains (losses) on marketable securities | (2) | 2 | (1) | |
Comprehensive loss | $ (12,540) | $ (10,266) | $ (24,406) | $ (21,869) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Operating activities: | ||
Net loss | $ (24,405) | $ (21,869) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation of property and equipment | 4,118 | 2,693 |
Amortization of intangible assets | 1,439 | 259 |
Amortization of deferred financing costs | 10 | 16 |
Change in fair value of mark-to-market liabilities | (1,266) | 83 |
Stock-based compensation | 10,419 | 7,440 |
Other | (899) | (66) |
Changes in assets and liabilities: | ||
Accounts receivable, net | (60,004) | (54,489) |
Prepaid expenses and other assets | 1,382 | (2,035) |
Deferred commissions | (932) | (3,101) |
Accounts payable and accrued liabilities | 3,010 | 2,198 |
Deferred revenue | 30,864 | 29,639 |
Deferred rent | 1,836 | (414) |
Net cash used in operating activities | (34,428) | (39,646) |
Investing activities: | ||
Purchases of property and equipment | (7,390) | (6,955) |
Purchases of intangible assets | (301) | |
Proceeds from sale of property and equipment | 52 | 38 |
Purchases of marketable securities | (48,441) | |
Maturities of marketable securities | 5,700 | 23,900 |
Net cash (used in) provided by investing activities | (50,079) | 16,682 |
Financing activities: | ||
Proceeds from common stock offerings, net of offering costs | 109,789 | |
Proceeds from issuance of common stock from employee equity plans | 7,249 | 4,316 |
Shares repurchased for tax withholdings on vesting of restricted stock | (255) | (123) |
Payments for financing costs | (18) | (24) |
Net cash provided by financing activities | 116,765 | 4,169 |
Net increase (decrease) in cash and cash equivalents | 32,258 | (18,795) |
Cash and cash equivalents, beginning of period | 35,693 | 44,539 |
Cash and cash equivalents, end of period | 67,951 | 25,744 |
Supplemental cash flow disclosure: | ||
Cash paid for taxes | 88 | 175 |
Non-cash investing and financing activities: | ||
Capital expenditures incurred but not yet paid | $ 18 | $ 210 |
Description of Business and Bas
Description of Business and Basis of Presentation | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Organization Instructure provides innovative applications for learning, assessment and talent management. We enable organizations worldwide to develop, deliver, manage and track engaging academic and employee development programs. We offer our platform through a Software-as-a-Service, or SaaS, business model. We were incorporated in the State of Delaware in September 2008. Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) applicable to interim periods, under the rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, we have prepared the accompanying unaudited financial statements on a basis substantially consistent with the audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 2017, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2018. The year-end balance sheet data was derived from audited financial statements, but this Form 10-Q does not include all disclosures required under GAAP. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted under the rules and regulations of the SEC. These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 15, 2018. Effective January 1, 2018, we adopted the requirements of Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers Certain prior period amounts reported in our interim and annual consolidated financial statements and notes thereto have been reclassified to conform to current period presentation. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Such estimates, which we evaluate on an on-going basis, include allowances for doubtful accounts, useful lives for property and equipment and intangible assets, valuation of marketable securities, valuation allowances for net deferred income tax assets, valuation of stock-based compensation and common stock, standalone selling price (“SSP”) of performance obligations and the determination of the period of benefit for deferred commissions Segment Information We operate in a single operating segment, cloud-based learning management systems. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the chief operating decision makers, or CODMs, which are our chief executive officer and chief financial officer, in deciding how to allocate resources and assess performance. Our CODMs evaluate our financial information and resources and assess the performance of these resources on a consolidated basis. Since we operate in one operating segment, all required financial segment information can be found on the consolidated financial statements. S ummary of Significant Accounting Policies Except for the accounting policies for revenue recognition, trade and other receivables, and deferred commissions that were updated as a result of adopting ASU No. 2014-09, there have been no changes to our significant accounting policies described in the Annual Report on Form 10-K as of and for the year ended December 31, 2017, filed with the SEC on February 15, 2018, that have had a material impact on our condensed consolidated financial statements and related notes. Revenue Recognition We generate revenue primarily from two main sources: (1) subscription and support revenue, which is comprised of SaaS fees from customers accessing our learning, assessment and talent management systems and from customers purchasing additional support beyond the standard support that is included in the basic SaaS fees; and (2) related professional services revenue, which is comprised of training, implementation services and other types of professional services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We determined revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer • Identification of the performance obligations in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, we satisfy a performance obligation The following describes the nature of our primary types of revenue and the revenue recognition policies and significant payment terms as they pertain to the types of transactions we enter into with our customers. Subscription and Support Subscription and support revenue is derived from fees from customers to access our learning, assessment and talent management systems and support beyond the standard support that is included with all subscriptions. The terms of our subscriptions do not provide customers the right to take possession of the software. Subscription and support r evenue is generally recognized on a ratable basis over the contract term. Professional Services and Other Professional services revenue is derived from implementation Contracts with Multiple Performance Obligations Many of our contracts with customers contain multiple performance obligations. We account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. We determine the standalone selling prices based on our overall pricing objectives by reviewing our SSP is analyzed on a periodic basis to identify if we have experienced significant changes in our selling prices. T rade and Other Receivables Accounts receivable, net is comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts, and other receivables, which represents unbilled receivables related to subscription and professional services contracts. Unbilled receivable balances as of June 30, 2018 and December 31, 2017 were $6,258,000 and $4,177,000, respectively. Standard payment terms to customers range from 30 to 90 days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for products and services in advance of our delivery of the related products or services; in other cases, payment is due as services are performed or in arrears following the delivery of the related products or services. The unbilled receivable primarily relates to revenue recognized when transferred services are more than amounts billable to customers. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized on a straight-line basis over a period of benefit that we have determined to be generally four years. We determined the period of benefit by taking into consideration our customer contracts, our technology and other factors. Amortization of deferred commissions is included in sales and marketing expenses in the accompanying consolidated statements of operations. Recent Accounting Pronouncements Adopted accounting pronouncements In October 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory”. This standard requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. The new standard must be adopted using a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings in the period of adoption. This standard is effective for annual reporting periods beginning after December 15, 2017. We adopted the new standard as of January 1, 2018 and it did not have a material impact on our consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“Topic 606”). Topic 606 supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition (“Topic 605”), and requires the recognition of revenue as promised goods or services are transferred to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. Topic 606 also includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers, which requires the deferral of incremental costs of obtaining a contract with a customer. Collectively, we refer to Topic 606 and Subtopic 340-40 as the “new standard”. We adopted the new standard as of January 1, 2018, utilizing the full retrospective method of transition. As a result, we recognized the cumulative effect of initially applying the new standard as an adjustment to the opening balance of equity on January 1, 2016. We have changed our accounting policy for revenue recognition as detailed above. The details of the significant changes and quantitative impact of the changes are disclosed below. We applied Topic 606 retrospectively using the following practical expedients in paragraph 606-10-65-1(f). We do not disclose the amount of consideration allocated to the remaining performance obligations or an explanation of when we expect to recognize that amount as revenue for all reporting periods presented before the date of the initial application – i.e. January 1, 2018. Further, we do not retrospectively restate contracts modified before the beginning of the earliest reporting period presented but reflect the aggregate effect of all modifications that occur before the beginning of the earliest period presented. The primary impact of adopting the new standard related to the deferral of incremental commission costs to obtain customer contracts and the removal of the contingent revenue limitation. We previously expensed sales commission costs as incurred. Under the new standard, we capitalize and amortize these costs over a period of benefit that we have determined to be generally four years. Impacts on Financial Statements The following tables summarize the impacts of Topic 606 adoption on our consolidated financial statements on the previously reported periods. Select consolidated balance sheet line items, which reflect the adoption of Topic 606, are as follows (in thousands): December 31, 2017 As previously reported Adjustments As adjusted Assets Accounts receivable—net of allowance $ 30,797 $ 3,515 $ 34,312 Deferred commissions — 7,086 7,086 Deferred commissions, net of current portion — 11,160 11,160 Other assets 1,045 (548 ) 497 Liabilities Deferred revenue 99,086 687 99,773 Deferred revenue, net of current portion 3,950 (2,061 ) 1,889 Select unaudited consolidated statement of operations line items, which reflect the adoption of Topic 606, are as follows (in thousands): Three months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 32,650 $ 1,063 $ 33,713 Professional services and other 5,394 (562 ) 4,832 Total revenue 38,044 501 38,545 Cost of revenue: Professional services and other 3,026 62 3,088 Gross profit 27,051 439 27,490 Operating expenses: Sales and marketing 21,314 (2,342 ) 18,972 Loss before income taxes (12,891 ) 2,791 (10,100 ) Income tax expense (105 ) (63 ) (168 ) Net loss (12,996 ) 2,728 (10,268 ) Net loss per common share, basic and diluted (0.45 ) 0.10 (0.35 ) Six months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 63,163 $ 2,104 $ 65,267 Professional services and other 8,860 (1,110 ) 7,750 Total revenue 72,023 994 73,017 Cost of revenue: Professional services and other 5,537 126 5,663 Gross profit 51,414 868 52,282 Operating expenses: Sales and marketing 40,300 (3,101 ) 37,199 Loss before income taxes (25,591 ) 3,973 (21,618 ) Income tax expense (136 ) (115 ) (251 ) Net loss (25,727 ) 3,858 (21,869 ) Net loss per common share, basic and diluted (0.89 ) 0.13 (0.76 ) Select unaudited consolidated statement of cash flows line items, which reflect the adoption of Topic 606, are as follows (in thousands): Six months ended June 30, 2017 As previously reported Adjustments As Adjusted Cash flows from operating activities: Net loss $ (25,727 ) $ 3,858 $ (21,869 ) Accounts receivable, net (55,105 ) 616 (54,489 ) Prepaid expenses and other assets (2,280 ) 245 (2,035 ) Deferred commissions — (3,101 ) (3,101 ) Deferred revenue 31,257 (1,618 ) 29,639 Net cash used in operating activities (39,646 ) — (39,646 ) Issued accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases, requiring recognition of a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. Long-term leases will continue to be classified as either operating or finance leases in the financial statements. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 2. Net Loss Per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of the diluted net loss per share calculation, options to purchase common stock, common stock warrants and restricted stock units are considered to be common stock equivalents. A reconciliation of the denominator used in the calculation of basic and diluted loss per share is as follows (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Numerator: Net loss $ (12,538 ) $ (10,268 ) $ (24,405 ) $ (21,869 ) Denominator: Total weighted average common shares outstanding—basic 34,491 29,090 33,444 28,909 Dilutive effect of share equivalents resulting from stock options, restricted stock units, common stock warrants and common stock subject to repurchase — — — — Weighted average common shares outstanding-diluted 34,491 29,090 33,444 28,909 Net loss per common share, basic and diluted $ (0.36 ) $ (0.35 ) $ (0.73 ) $ (0.76 ) For all periods presented, we incurred net losses and, therefore, the effect of our outstanding stock options, restricted stock units and common stock warrants was not included in the calculation of diluted loss per share as the effect would be anti-dilutive. The following table contains share totals with a potentially dilutive impact (in thousands): As of June 30, 2018 2017 Options to purchase common stock 1,542 2,784 Common stock warrants — 17 Restricted stock units 1,853 1,629 Total 3,395 4,430 |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 3. Property and Equipment Property and equipment consisted of the following (in thousands): June 30, December 31, 2018 2017 Computer and office equipment $ 5,918 $ 5,726 Purchased software 1,071 1,071 Capitalized software development costs 18,948 14,755 Furniture and fixtures 4,304 3,924 Leasehold improvements and other 15,247 13,379 Total property and equipment 45,488 38,855 Less accumulated depreciation and amortization (17,941 ) (14,929 ) Total $ 27,547 $ 23,926 Accumulated amortization for capitalized software development costs was $6,558,000 and $4,570,000 at June 30, 2018 and December 31, 2017, respectively. Amortization expense for capitalized software development costs was $1,048,000 and $521,000 for the three months ended June 30, 2018 and 2017, respectively, and $1,988,000 and $1,006,000 for the six months ended June 30, 2018 and 2017, respectively. Amortization expense for capitalized software development costs is recorded within cost of revenue on the consolidated statements of operations. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 4. Goodwill and Intangible Assets Goodwill was $12,354,000 as of June 30, 2018 and December 31, 2017. Intangible assets consisted of the following (in thousands): Average June 30, December 31, Useful Life 2018 2017 Domain names 4 Months $ 1,268 $ 1,268 Trademarks 0 Months 120 120 Software 13 Months 620 620 Capitalized learning content 40 Months 400 400 Trade names 29 Months 320 320 Developed technology 41 Months 5,320 5,320 Customer relationships 29 Months 2,910 2,910 Accumulated amortization (3,349 ) (1,910 ) Total $ 7,609 $ 9,048 Amortization expense for intangible assets was $676,000 and $117,000 for the three months ended June 30, 2018 and 2017, respectively, and $1,439,000 and $259,000 for the six months ended June 30, 2018 and 2017, respectively. Based on the recorded intangible assets at June 30, 2018, estimated amortization expense is expected to be as follows (in thousands): Amortization Years Ending December 31, Expense Remainder of 2018 $ 1,347 2019 2,626 2020 2,386 2021 1,250 2022 — Total $ 7,609 |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Revenue | 5. Revenue Disaggregation of Revenue Revenue by geographic region, based on the physical location of the customer, is (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 *As Adjusted *As Adjusted United States $ 40,489 $ 33,172 $ 79,796 $ 63,726 Foreign 9,574 5,373 18,258 9,291 Total revenue $ 50,063 $ 38,545 $ 98,054 $ 73,017 Percentage of revenue generated outside of the United States 19 % 14 % 19 % 13 % * See Note 1 for a summary of adjustments Deferred Revenue and Performance Obligations During the three months ended June 30, 2018, 80% to 90% of revenue recognized was included in our deferred revenue balance at the beginning of the period. During the six months ended June 30, 2018, 75% to 85% of revenue recognized was included in our deferred revenue balance at the beginning of the period. Transaction Price Allocated to the Remaining Performance Obligations As of June 30, 2018, approximately $448 million of revenue is expected to be recognized from remaining performance obligations. We expect to recognize revenue on approximately 69% of these remaining performance obligations over the next 24 months, with the balance recognized thereafter. |
Deferred Commissions
Deferred Commissions | 6 Months Ended |
Jun. 30, 2018 | |
Deferred Costs [Abstract] | |
Deferred Commissions | 6. Deferred Commissions Deferred commissions primarily consist of sales commissions that are capitalized as incremental contract origination costs and were $19,179,000 and $18,246,000 as of June 30, 2018 and December 31, 2017, respectively. For the three months ended June 30, 2018 and 2017, amortization expense for deferred commissions was $2,466,000 and $1,701,000, respectively, and there were no impairments of deferred commissions commissions |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Marketable Securities | 7. Marketable Securities Our investment policy is consistent with the definition of available-for-sale securities. We do not buy and hold securities principally for the purpose of selling them in the near future nor do we intend to hold securities to maturity. Rather, our policy is focused on the preservation of capital, liquidity and return. From time to time, we may sell certain securities but the objectives are generally not to generate profits on short-term differences in price. The following table summarizes, by major security type, our assets that are measured at fair value on a recurring basis (in thousands): June 30, 2018 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 28,665 $ — $ (3 ) $ 28,662 Government treasury bills 19,925 1 — 19,926 $ 48,590 $ 1 $ (3 ) $ 48,588 December 31, 2017 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 5,698 $ — $ (1 ) $ 5,697 $ 5,698 $ — $ (1 ) $ 5,697 There were no gross realized gains or losses from the sale or maturity of marketable securities during the six months ended June 30, 2018 and 2017. During the six months ended June 30, 2018, we recognized gross interest income on securities of $267,000. Interest income was inclusive of accretion income of $181,000 and offset by amortization expense on securities of $16,000 during the six months ended June 30, 2018, and reported net within interest income on the consolidated statements of operations. During the six months ended June 30, 2017, we recognized gross interest income on securities of $89,000. Interest income was offset by amortization expense on securities of $8,000 during the six months ended June 30, 2017, and reported net within interest income on the consolidated statements of operations. The estimated fair value of investments by contractual maturity is as follows (in thousands): June 30, December 31, 2018 2017 Due within one year $ 48,588 $ 5,697 Total $ 48,588 $ 5,697 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) and Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders' Equity (Deficit) and Stock-Based Compensation | 8. Stockholders’ Equity (Deficit) and Stock-Based Compensation Common Stock As of June 30, 2018 and December 31, 2017, there were 200,000,000 shares of common stock authorized. As of June 30, 2018 and December 31, 2017, there were 34,765,435 and 30,860,241 shares issued and outstanding, respectively. Each share of common stock has the right to one vote on all matters submitted to a vote of stockholders. The holders of common stock are also entitled to receive dividends whenever funds are legally available and if declared by the board of directors, subject to prior rights of holders of all classes of stock outstanding having priority rights as to dividends. No dividends have been declared or paid on the common stock through June 30, 2018. On February 15, 2018, we entered into an underwriting agreement (the “Underwriting Agreement”) with Morgan Stanley & Co. LLC and Credit Suisse Securities (USA) LLC (collectively, the “Underwriters”), relating to the issuance and sale (the “Offering”) of 2,500,000 shares of our common stock, par value $0.0001 per share. The price to the public in the Offering was $39.50 per share, and the Underwriters have purchased the shares from us pursuant to the Underwriting Agreement at a price of $38.315 per share. In addition to the sale of 2,500,000 shares, the Underwriters exercised a 30-day option to purchase an additional 375,000 shares of our common stock. All of the shares in the offering were sold by us and the net proceeds to us from this Offering were $109.8 million, after deducting underwriting discounts and commissions and other offering expenses payable by us. Employee Equity Plans Our 2015 Equity Incentive Plan (the “2015 Plan”) serves as the successor to our 2010 Equity Incentive Plan (the “2010 Plan”). Accordingly, no shares are available for issuance under the 2010 Plan; however, any outstanding options granted under the 2010 Plan will remain outstanding and subject to the terms of that plan until exercised, terminated or expired by their terms. As of June 30, 2018, options to purchase 1,085,738 shares of common stock remained outstanding under the 2010 Plan. Pursuant to the terms of the 2015 Plan, the share reserve automatically increased by 1,388,709 shares in January 2018. As of June 30, 2018, we had 2,599,249 shares of common stock available for future grants under the 2015 Plan. Additionally, as part of our acquisition of Practice XYZ, Inc. (“Practice”) we assumed Practice’s 2014 Equity Incentive Plan (the “2014 Plan”). No shares are available for issuance under the 2014 Plan; however, any outstanding options granted under the 2014 Plan will remain outstanding and subject to the terms of that plan until exercised, terminated or expired by their terms. As of June 30, 2018, options to purchase 1,093 shares of common stock remained outstanding under the 2014 Plan. We also have a 2015 Employee Stock Purchase Plan (the “ESPP”). The ESPP allows eligible employees to purchase shares of our common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. Our board of directors approves the ESPP offerings. The offerings need not be identical, but each offering may not exceed 27 months and may specify one or more shorter purchase periods within the offering. The following two tables show stock-based compensation expense by award type and where the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Options $ 725 $ 966 $ 1,426 $ 2,184 Restricted stock units 4,431 2,632 7,931 4,297 Employee stock purchase plan 519 469 1,062 959 Total stock-based compensation $ 5,675 $ 4,067 $ 10,419 $ 7,440 Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Subscription and support cost of revenue $ 307 $ 191 $ 536 $ 317 Professional services and other cost of revenue 246 156 439 261 Sales and marketing 1,671 1,195 3,019 2,150 Research and development 2,033 1,506 3,927 2,738 General and administrative 1,418 1,019 2,498 1,974 Total stock-based compensation $ 5,675 $ 4,067 $ 10,419 $ 7,440 Stock Options The following table summarizes s tock option activity for the six months ended June 30, 2018 (in thousands, except per share data and years): Weighted- Weighted- Average Shares Average Remaining Aggregate Underlying Exercise Life Intrinsic Options Price (in years) Value Outstanding at December 31, 2017 2,010 $ 9.09 6.5 $ 48,266 Granted 243 34.72 Exercised (620 ) 6.81 Forfeited or cancelled (91 ) 21.06 Outstanding at June 30, 2018 1,542 13.31 6.8 45,117 Vested and expected to vest—June 30, 2018 1,542 13.31 6.8 45,117 Exercisable at June 30, 2018 1,053 8.55 6.1 35,790 As of June 30, 2018, we had $5,812,000 of unrecognized stock-based compensation costs related to non-vested options that are expected to be recognized over a weighted average period of 2.9 years. As of June 30, 2018, we had $1,138,000 of unrecognized stock-based compensation expense related to our ESPP that is expected to be recognized over the term of the offering period ending November 30, 2018. Restricted Stock Units The following table summarizes the activity of restricted stock units (“RSUs”) for the six months ended June 30, 2018 (in thousands, except per share data): RSUs Outstanding Weighted- Average Grant Date Fair Shares Value Unvested and outstanding at December 31, 2017 1,515 $ 22.88 Granted 837 41.70 Vested (313 ) 22.95 Cancelled (186 ) 25.96 Unvested and outstanding at June 30, 2018 1,853 31.06 As of June 30, 2018, we had $53,895,000 of unrecognized stock-based compensation costs related to outstanding RSUs that are expected to be recognized over a weighted average period of 3.1 years. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 9. Income Taxes Utilization of the net operating loss carryforwards and credits may be subject to substantial annual limitation due to the ownership change limitations provided by Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. We file tax returns in the United States, the United Kingdom, Australia, the Netherlands, Hong Kong, Sweden, Brazil, Mexico and various state jurisdictions. All of our tax years remain open to examination by major taxing jurisdictions to which we are subject, as carryforward attributes generated in past years may still be adjusted upon examination by the Internal Revenue Service or state and foreign tax authorities if they have or will be used in future periods. We believe that we have provided adequate reserves for our income tax uncertainties in all open tax years. We do not expect our gross unrecognized tax benefits to change significantly in the next 12 months. In connection with the Tax Act enacted in December 2017, we recorded a provisional amount for the remeasurement of deferred tax balances for the year ended December 31, 2017 with an offset to valuation allowance with no impact to the consolidated financial statements. In accordance with relevant SEC guidance of Staff Accounting Bulletin No. 118 (“SAB 118”), the effects of the Tax Act may be adjusted within a one-year measurement period from the enactment date for the items that were previously reported as provisional, or where a provisional estimate could not be made. The income tax provision for the three-months ended June 30, 2018 did not reflect any adjustments to the provisional amounts as of December 31, 2017. We will continue to assess forthcoming guidance and accounting interpretations on the effects of the Tax Act and expect to complete our analysis within the measurement period in accordance with the SEC guidance. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 10. Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy prioritizes the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. There were no transfers between Level 1 and Level 2 of the fair value measurement hierarchy during the six months ended June 30, 2018 and the year ended December 31, 2017. Assets and liabilities measured at fair value on a recurring basis as of June 30, 2018, were as follows (in thousands): June 30, 2018 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 31,533 $ — $ — $ 31,533 Corporate debt securities — 28,726 — 28,726 Government treasury bills 19,926 — — 19,926 Total assets $ 51,459 $ 28,726 $ — $ 80,185 Liabilities: Contingent liability — — 20 20 Total liabilities $ — $ — $ 20 $ 20 Assets and liabilities measured at fair value on a recurring basis as of December 31, 2017, were as follows (in thousands): December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 14,046 $ — $ — $ 14,046 Corporate debt securities — 5,697 — 5,697 Total assets $ 14,046 $ 5,697 $ — $ 19,743 Liabilities: Common stock warrant liability — — 122 122 Contingent liability — — 1,164 1,164 Total liabilities $ — $ — $ 1,286 $ 1,286 The carrying amount of our cash, receivables and payables approximates fair value because of the short-term nature of these items. The following table sets forth a summary of the change in fair value adjustments for liabilities that are required to be marked-to-market. The common stock warrants were cancelled during the period ended March 31, 2018, and the gain related to the extinguishment of the common stock warrant liability was recognized in other income (expense) on the consolidated statements of operations. The change in fair value of the contingent liability was recognized in general and administrative expense on the consolidated statements of operations. The following balance Change in Fair Value Adjustments Balance at January 1, 2018 $ 1,286 Extinguishment of common stock warrants (122 ) Change in fair value of contingent liability (1,144 ) Balance at June 30, 2018 $ 20 We have classified our liability for contingent consideration relating to our acquisition of Practice XYZ, Inc., which we closed in November 2017, within Level 3 of the fair value hierarchy because the fair value is determined using the Monte Carlo simulation model and significant unobservable inputs including, forecasted net bookings attainment. Fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy level assigned to each security in our marketable securities portfolio and cash equivalents is based on our assessment of the transparency and reliability of the inputs used in the valuation of such instrument at the measurement date. The fair value of cash equivalents included in the Level 1 category is based on quoted prices that are readily and regularly available in an active market. The fair value of the marketable securities included in the Level 2 category is based on observable inputs, such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. These values were obtained from an independent pricing service and were evaluated using pricing models that vary by asset class and may incorporate available trade, bid and other market information and price quotes from well-established independent pricing vendors and broker-dealers. See Note 7—Marketable Securities for further information regarding the fair value of our investments. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Litigation We are involved in legal proceedings from time to time arising in the normal course of business. Management believes that the outcome of these proceedings will not have a material impact on our financial position, results of operations or liquidity. Lease Commitments We lease office space under non-cancelable operating leases that contain rent escalation clauses and renewal options. We recognize rent expense on a straight-line basis over the lease period and have accrued for rent expense incurred but not paid. We are also committed to pay a portion of the actual operating expenses under certain of these lease agreements. Rent expense under operating leases was $1,866,000 and $1,332,000 for the three months ended June 30, 2018 and 2017, respectively, and $3,745,000 and $2,533,000 for the six months ended June 30, 2018 and 2017, respectively. |
Description of Business and B18
Description of Business and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) applicable to interim periods, under the rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, we have prepared the accompanying unaudited financial statements on a basis substantially consistent with the audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 2017, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2018. The year-end balance sheet data was derived from audited financial statements, but this Form 10-Q does not include all disclosures required under GAAP. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted under the rules and regulations of the SEC. These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 15, 2018. Effective January 1, 2018, we adopted the requirements of Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers Certain prior period amounts reported in our interim and annual consolidated financial statements and notes thereto have been reclassified to conform to current period presentation. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Such estimates, which we evaluate on an on-going basis, include allowances for doubtful accounts, useful lives for property and equipment and intangible assets, valuation of marketable securities, valuation allowances for net deferred income tax assets, valuation of stock-based compensation and common stock, standalone selling price (“SSP”) of performance obligations and the determination of the period of benefit for deferred commissions |
Segment Information | Segment Information We operate in a single operating segment, cloud-based learning management systems. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the chief operating decision makers, or CODMs, which are our chief executive officer and chief financial officer, in deciding how to allocate resources and assess performance. Our CODMs evaluate our financial information and resources and assess the performance of these resources on a consolidated basis. Since we operate in one operating segment, all required financial segment information can be found on the consolidated financial statements. |
Summary of Significant Accounting Policies | S ummary of Significant Accounting Policies Except for the accounting policies for revenue recognition, trade and other receivables, and deferred commissions that were updated as a result of adopting ASU No. 2014-09, there have been no changes to our significant accounting policies described in the Annual Report on Form 10-K as of and for the year ended December 31, 2017, filed with the SEC on February 15, 2018, that have had a material impact on our condensed consolidated financial statements and related notes. |
Revenue Recognition | Revenue Recognition We generate revenue primarily from two main sources: (1) subscription and support revenue, which is comprised of SaaS fees from customers accessing our learning, assessment and talent management systems and from customers purchasing additional support beyond the standard support that is included in the basic SaaS fees; and (2) related professional services revenue, which is comprised of training, implementation services and other types of professional services. Revenues are recognized when control of these services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those services. We determined revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer • Identification of the performance obligations in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, we satisfy a performance obligation The following describes the nature of our primary types of revenue and the revenue recognition policies and significant payment terms as they pertain to the types of transactions we enter into with our customers. Subscription and Support Subscription and support revenue is derived from fees from customers to access our learning, assessment and talent management systems and support beyond the standard support that is included with all subscriptions. The terms of our subscriptions do not provide customers the right to take possession of the software. Subscription and support r evenue is generally recognized on a ratable basis over the contract term. Professional Services and Other Professional services revenue is derived from implementation Contracts with Multiple Performance Obligations Many of our contracts with customers contain multiple performance obligations. We account for individual performance obligations separately if they are distinct. The transaction price is allocated to the separate performance obligations on a relative standalone selling price basis. We determine the standalone selling prices based on our overall pricing objectives by reviewing our SSP is analyzed on a periodic basis to identify if we have experienced significant changes in our selling prices. T rade and Other Receivables Accounts receivable, net is comprised of trade receivables that are recorded at the invoice amount, net of an allowance for doubtful accounts, and other receivables, which represents unbilled receivables related to subscription and professional services contracts. Unbilled receivable balances as of June 30, 2018 and December 31, 2017 were $6,258,000 and $4,177,000, respectively. Standard payment terms to customers range from 30 to 90 days; however, payment terms and conditions in our customer contracts may vary. In some cases, customers prepay for products and services in advance of our delivery of the related products or services; in other cases, payment is due as services are performed or in arrears following the delivery of the related products or services. The unbilled receivable primarily relates to revenue recognized when transferred services are more than amounts billable to customers. Deferred Commissions Sales commissions earned by our sales force are considered incremental and recoverable costs of obtaining a contract with a customer. These costs are deferred and then amortized on a straight-line basis over a period of benefit that we have determined to be generally four years. We determined the period of benefit by taking into consideration our customer contracts, our technology and other factors. Amortization of deferred commissions is included in sales and marketing expenses in the accompanying consolidated statements of operations. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted accounting pronouncements In October 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory”. This standard requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. The new standard must be adopted using a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings in the period of adoption. This standard is effective for annual reporting periods beginning after December 15, 2017. We adopted the new standard as of January 1, 2018 and it did not have a material impact on our consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“Topic 606”). Topic 606 supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition (“Topic 605”), and requires the recognition of revenue as promised goods or services are transferred to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. Topic 606 also includes Subtopic 340-40, Other Assets and Deferred Costs - Contracts with Customers, which requires the deferral of incremental costs of obtaining a contract with a customer. Collectively, we refer to Topic 606 and Subtopic 340-40 as the “new standard”. We adopted the new standard as of January 1, 2018, utilizing the full retrospective method of transition. As a result, we recognized the cumulative effect of initially applying the new standard as an adjustment to the opening balance of equity on January 1, 2016. We have changed our accounting policy for revenue recognition as detailed above. The details of the significant changes and quantitative impact of the changes are disclosed below. We applied Topic 606 retrospectively using the following practical expedients in paragraph 606-10-65-1(f). We do not disclose the amount of consideration allocated to the remaining performance obligations or an explanation of when we expect to recognize that amount as revenue for all reporting periods presented before the date of the initial application – i.e. January 1, 2018. Further, we do not retrospectively restate contracts modified before the beginning of the earliest reporting period presented but reflect the aggregate effect of all modifications that occur before the beginning of the earliest period presented. The primary impact of adopting the new standard related to the deferral of incremental commission costs to obtain customer contracts and the removal of the contingent revenue limitation. We previously expensed sales commission costs as incurred. Under the new standard, we capitalize and amortize these costs over a period of benefit that we have determined to be generally four years. Impacts on Financial Statements The following tables summarize the impacts of Topic 606 adoption on our consolidated financial statements on the previously reported periods. Select consolidated balance sheet line items, which reflect the adoption of Topic 606, are as follows (in thousands): December 31, 2017 As previously reported Adjustments As adjusted Assets Accounts receivable—net of allowance $ 30,797 $ 3,515 $ 34,312 Deferred commissions — 7,086 7,086 Deferred commissions, net of current portion — 11,160 11,160 Other assets 1,045 (548 ) 497 Liabilities Deferred revenue 99,086 687 99,773 Deferred revenue, net of current portion 3,950 (2,061 ) 1,889 Select unaudited consolidated statement of operations line items, which reflect the adoption of Topic 606, are as follows (in thousands): Three months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 32,650 $ 1,063 $ 33,713 Professional services and other 5,394 (562 ) 4,832 Total revenue 38,044 501 38,545 Cost of revenue: Professional services and other 3,026 62 3,088 Gross profit 27,051 439 27,490 Operating expenses: Sales and marketing 21,314 (2,342 ) 18,972 Loss before income taxes (12,891 ) 2,791 (10,100 ) Income tax expense (105 ) (63 ) (168 ) Net loss (12,996 ) 2,728 (10,268 ) Net loss per common share, basic and diluted (0.45 ) 0.10 (0.35 ) Six months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 63,163 $ 2,104 $ 65,267 Professional services and other 8,860 (1,110 ) 7,750 Total revenue 72,023 994 73,017 Cost of revenue: Professional services and other 5,537 126 5,663 Gross profit 51,414 868 52,282 Operating expenses: Sales and marketing 40,300 (3,101 ) 37,199 Loss before income taxes (25,591 ) 3,973 (21,618 ) Income tax expense (136 ) (115 ) (251 ) Net loss (25,727 ) 3,858 (21,869 ) Net loss per common share, basic and diluted (0.89 ) 0.13 (0.76 ) Select unaudited consolidated statement of cash flows line items, which reflect the adoption of Topic 606, are as follows (in thousands): Six months ended June 30, 2017 As previously reported Adjustments As Adjusted Cash flows from operating activities: Net loss $ (25,727 ) $ 3,858 $ (21,869 ) Accounts receivable, net (55,105 ) 616 (54,489 ) Prepaid expenses and other assets (2,280 ) 245 (2,035 ) Deferred commissions — (3,101 ) (3,101 ) Deferred revenue 31,257 (1,618 ) 29,639 Net cash used in operating activities (39,646 ) — (39,646 ) Issued accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases, requiring recognition of a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. Long-term leases will continue to be classified as either operating or finance leases in the financial statements. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. |
Description of Business and B19
Description of Business and Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Adoption of Topic 606 | The following tables summarize the impacts of Topic 606 adoption on our consolidated financial statements on the previously reported periods. Select consolidated balance sheet line items, which reflect the adoption of Topic 606, are as follows (in thousands): December 31, 2017 As previously reported Adjustments As adjusted Assets Accounts receivable—net of allowance $ 30,797 $ 3,515 $ 34,312 Deferred commissions — 7,086 7,086 Deferred commissions, net of current portion — 11,160 11,160 Other assets 1,045 (548 ) 497 Liabilities Deferred revenue 99,086 687 99,773 Deferred revenue, net of current portion 3,950 (2,061 ) 1,889 Select unaudited consolidated statement of operations line items, which reflect the adoption of Topic 606, are as follows (in thousands): Three months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 32,650 $ 1,063 $ 33,713 Professional services and other 5,394 (562 ) 4,832 Total revenue 38,044 501 38,545 Cost of revenue: Professional services and other 3,026 62 3,088 Gross profit 27,051 439 27,490 Operating expenses: Sales and marketing 21,314 (2,342 ) 18,972 Loss before income taxes (12,891 ) 2,791 (10,100 ) Income tax expense (105 ) (63 ) (168 ) Net loss (12,996 ) 2,728 (10,268 ) Net loss per common share, basic and diluted (0.45 ) 0.10 (0.35 ) Six months ended June 30, 2017 As previously reported Adjustments As adjusted Revenue: Subscription and support $ 63,163 $ 2,104 $ 65,267 Professional services and other 8,860 (1,110 ) 7,750 Total revenue 72,023 994 73,017 Cost of revenue: Professional services and other 5,537 126 5,663 Gross profit 51,414 868 52,282 Operating expenses: Sales and marketing 40,300 (3,101 ) 37,199 Loss before income taxes (25,591 ) 3,973 (21,618 ) Income tax expense (136 ) (115 ) (251 ) Net loss (25,727 ) 3,858 (21,869 ) Net loss per common share, basic and diluted (0.89 ) 0.13 (0.76 ) Select unaudited consolidated statement of cash flows line items, which reflect the adoption of Topic 606, are as follows (in thousands): Six months ended June 30, 2017 As previously reported Adjustments As Adjusted Cash flows from operating activities: Net loss $ (25,727 ) $ 3,858 $ (21,869 ) Accounts receivable, net (55,105 ) 616 (54,489 ) Prepaid expenses and other assets (2,280 ) 245 (2,035 ) Deferred commissions — (3,101 ) (3,101 ) Deferred revenue 31,257 (1,618 ) 29,639 Net cash used in operating activities (39,646 ) — (39,646 ) |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Summary of Reconciliation of the Denominator Used in the Calculation of Basic and Diluted Loss Per Share | A reconciliation of the denominator used in the calculation of basic and diluted loss per share is as follows (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Numerator: Net loss $ (12,538 ) $ (10,268 ) $ (24,405 ) $ (21,869 ) Denominator: Total weighted average common shares outstanding—basic 34,491 29,090 33,444 28,909 Dilutive effect of share equivalents resulting from stock options, restricted stock units, common stock warrants and common stock subject to repurchase — — — — Weighted average common shares outstanding-diluted 34,491 29,090 33,444 28,909 Net loss per common share, basic and diluted $ (0.36 ) $ (0.35 ) $ (0.73 ) $ (0.76 ) |
Summary of Shares Excluded from Calculation of Diluted Loss Per Share with a Potential Dilutive Impact | The following table contains share totals with a potentially dilutive impact (in thousands): As of June 30, 2018 2017 Options to purchase common stock 1,542 2,784 Common stock warrants — 17 Restricted stock units 1,853 1,629 Total 3,395 4,430 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following (in thousands): June 30, December 31, 2018 2017 Computer and office equipment $ 5,918 $ 5,726 Purchased software 1,071 1,071 Capitalized software development costs 18,948 14,755 Furniture and fixtures 4,304 3,924 Leasehold improvements and other 15,247 13,379 Total property and equipment 45,488 38,855 Less accumulated depreciation and amortization (17,941 ) (14,929 ) Total $ 27,547 $ 23,926 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Intangible assets consisted of the following (in thousands): Average June 30, December 31, Useful Life 2018 2017 Domain names 4 Months $ 1,268 $ 1,268 Trademarks 0 Months 120 120 Software 13 Months 620 620 Capitalized learning content 40 Months 400 400 Trade names 29 Months 320 320 Developed technology 41 Months 5,320 5,320 Customer relationships 29 Months 2,910 2,910 Accumulated amortization (3,349 ) (1,910 ) Total $ 7,609 $ 9,048 |
Estimated Amortization Expense | Based on the recorded intangible assets at June 30, 2018, estimated amortization expense is expected to be as follows (in thousands): Amortization Years Ending December 31, Expense Remainder of 2018 $ 1,347 2019 2,626 2020 2,386 2021 1,250 2022 — Total $ 7,609 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Disaggregation of Revenue by Geographic Region | Revenue by geographic region, based on the physical location of the customer, is (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 *As Adjusted *As Adjusted United States $ 40,489 $ 33,172 $ 79,796 $ 63,726 Foreign 9,574 5,373 18,258 9,291 Total revenue $ 50,063 $ 38,545 $ 98,054 $ 73,017 Percentage of revenue generated outside of the United States 19 % 14 % 19 % 13 % * See Note 1 for a summary of adjustments |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Major Security Type Assets Measured at Fair Value on Recurring Basis | The following table summarizes, by major security type, our assets that are measured at fair value on a recurring basis (in thousands): June 30, 2018 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 28,665 $ — $ (3 ) $ 28,662 Government treasury bills 19,925 1 — 19,926 $ 48,590 $ 1 $ (3 ) $ 48,588 December 31, 2017 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 5,698 $ — $ (1 ) $ 5,697 $ 5,698 $ — $ (1 ) $ 5,697 |
Schedule of Estimated Fair Value of Investments by Contractual Maturity | The estimated fair value of investments by contractual maturity is as follows (in thousands): June 30, December 31, 2018 2017 Due within one year $ 48,588 $ 5,697 Total $ 48,588 $ 5,697 |
Stockholders' Equity (Deficit25
Stockholders' Equity (Deficit) and Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock-Based Compensation Expense by Award Type | stock-based compensation expense by award type Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Options $ 725 $ 966 $ 1,426 $ 2,184 Restricted stock units 4,431 2,632 7,931 4,297 Employee stock purchase plan 519 469 1,062 959 Total stock-based compensation $ 5,675 $ 4,067 $ 10,419 $ 7,440 |
Summary of Stock-Based Compensation Expense Recorded in Consolidated Statement of Operations | the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands) Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Subscription and support cost of revenue $ 307 $ 191 $ 536 $ 317 Professional services and other cost of revenue 246 156 439 261 Sales and marketing 1,671 1,195 3,019 2,150 Research and development 2,033 1,506 3,927 2,738 General and administrative 1,418 1,019 2,498 1,974 Total stock-based compensation $ 5,675 $ 4,067 $ 10,419 $ 7,440 |
Summary of Stock Option Activity | The following table summarizes s tock option activity for the six months ended June 30, 2018 (in thousands, except per share data and years): Weighted- Weighted- Average Shares Average Remaining Aggregate Underlying Exercise Life Intrinsic Options Price (in years) Value Outstanding at December 31, 2017 2,010 $ 9.09 6.5 $ 48,266 Granted 243 34.72 Exercised (620 ) 6.81 Forfeited or cancelled (91 ) 21.06 Outstanding at June 30, 2018 1,542 13.31 6.8 45,117 Vested and expected to vest—June 30, 2018 1,542 13.31 6.8 45,117 Exercisable at June 30, 2018 1,053 8.55 6.1 35,790 |
Summary of Restricted Stock Units Activity | The following table summarizes the activity of restricted stock units (“RSUs”) for the six months ended June 30, 2018 (in thousands, except per share data): RSUs Outstanding Weighted- Average Grant Date Fair Shares Value Unvested and outstanding at December 31, 2017 1,515 $ 22.88 Granted 837 41.70 Vested (313 ) 22.95 Cancelled (186 ) 25.96 Unvested and outstanding at June 30, 2018 1,853 31.06 |
Fair Value of Financial Instr26
Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis | There were no transfers between Level 1 and Level 2 of the fair value measurement hierarchy during the six months ended June 30, 2018 and the year ended December 31, 2017. Assets and liabilities measured at fair value on a recurring basis as of June 30, 2018, were as follows (in thousands): June 30, 2018 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 31,533 $ — $ — $ 31,533 Corporate debt securities — 28,726 — 28,726 Government treasury bills 19,926 — — 19,926 Total assets $ 51,459 $ 28,726 $ — $ 80,185 Liabilities: Contingent liability — — 20 20 Total liabilities $ — $ — $ 20 $ 20 Assets and liabilities measured at fair value on a recurring basis as of December 31, 2017, were as follows (in thousands): December 31, 2017 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 14,046 $ — $ — $ 14,046 Corporate debt securities — 5,697 — 5,697 Total assets $ 14,046 $ 5,697 $ — $ 19,743 Liabilities: Common stock warrant liability — — 122 122 Contingent liability — — 1,164 1,164 Total liabilities $ — $ — $ 1,286 $ 1,286 |
Summary of Changes in Fair Value Adjustments for Liabilities | The following table sets forth a summary of the change in fair value adjustments for liabilities that are required to be marked-to-market. The common stock warrants were cancelled during the period ended March 31, 2018, and the gain related to the extinguishment of the common stock warrant liability was recognized in other income (expense) on the consolidated statements of operations. The change in fair value of the contingent liability was recognized in general and administrative expense on the consolidated statements of operations. The following balance Change in Fair Value Adjustments Balance at January 1, 2018 $ 1,286 Extinguishment of common stock warrants (122 ) Change in fair value of contingent liability (1,144 ) Balance at June 30, 2018 $ 20 |
Description of Business and B27
Description of Business and Basis of Presentation - Additional Information (Details) | 6 Months Ended | |
Jun. 30, 2018USD ($)Segment | Dec. 31, 2017USD ($) | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||
Entity incorporation date | 2008-09 | |
Number of operating segment | Segment | 1 | |
Unbilled receivable, balance | $ | $ 6,258,000 | $ 4,177,000 |
Standard payment terms to customers minimum range | 30 days | |
Standard payment terms to customers maximum range | 90 days | |
Deferred costs amortization period | 4 years | |
Adoption of New Standard | ||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||
Capitalized contract costs amortization period | 4 years |
Description of Business and B28
Description of Business and Basis of Presentation - Summary of Consolidated Balance Sheet Reflecting Adoption of Topic 606 (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Accounts receivable—net of allowance | $ 93,841 | $ 34,312 |
Deferred commissions | 8,070 | 7,086 |
Deferred commissions, net of current portion | 11,108 | 11,160 |
Other assets | 537 | 497 |
Liabilities | ||
Deferred revenue | 129,860 | 99,773 |
Deferred revenue, net of current portion | $ 2,666 | 1,889 |
As Previously Reported | Adoption of New Standard | ||
Assets | ||
Accounts receivable—net of allowance | 30,797 | |
Other assets | 1,045 | |
Liabilities | ||
Deferred revenue | 99,086 | |
Deferred revenue, net of current portion | 3,950 | |
Adjustments | Adoption of New Standard | ||
Assets | ||
Accounts receivable—net of allowance | 3,515 | |
Deferred commissions | 7,086 | |
Deferred commissions, net of current portion | 11,160 | |
Other assets | (548) | |
Liabilities | ||
Deferred revenue | 687 | |
Deferred revenue, net of current portion | $ (2,061) |
Description of Business and B29
Description of Business and Basis of Presentation - Summary of Unaudited Consolidated Statement of Operations Reflecting Adoption of Topic 606 (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | $ 50,063 | $ 38,545 | $ 98,054 | $ 73,017 |
Cost of revenues | 14,598 | 11,055 | 28,583 | 20,735 |
Gross profit | 35,465 | 27,490 | 69,471 | 52,282 |
Operating expenses: | ||||
Sales and marketing | 24,841 | 18,972 | 48,029 | 37,199 |
Loss before income taxes | (12,445) | (10,100) | (24,173) | (21,618) |
Income tax expense | (93) | (168) | (232) | (251) |
Net loss | $ (12,538) | $ (10,268) | $ (24,405) | $ (21,869) |
Net loss per common share, basic and diluted | $ (0.36) | $ (0.35) | $ (0.73) | $ (0.76) |
Subscription and Support | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | $ 45,104 | $ 33,713 | $ 88,304 | $ 65,267 |
Cost of revenues | 10,784 | 7,967 | 21,175 | 15,072 |
Professional Services and Other | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | 4,959 | 4,832 | 9,750 | 7,750 |
Cost of revenues | $ 3,814 | 3,088 | $ 7,408 | 5,663 |
As Previously Reported | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | 38,044 | 72,023 | ||
Gross profit | 27,051 | 51,414 | ||
Operating expenses: | ||||
Sales and marketing | 21,314 | 40,300 | ||
Loss before income taxes | (12,891) | (25,591) | ||
Income tax expense | (105) | (136) | ||
Net loss | $ (12,996) | $ (25,727) | ||
Net loss per common share, basic and diluted | $ (0.45) | $ (0.89) | ||
As Previously Reported | Subscription and Support | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | $ 32,650 | $ 63,163 | ||
As Previously Reported | Professional Services and Other | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | 5,394 | 8,860 | ||
Cost of revenues | 3,026 | 5,537 | ||
Adjustments | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | 501 | 994 | ||
Gross profit | 439 | 868 | ||
Operating expenses: | ||||
Sales and marketing | (2,342) | (3,101) | ||
Loss before income taxes | 2,791 | 3,973 | ||
Income tax expense | (63) | (115) | ||
Net loss | $ 2,728 | $ 3,858 | ||
Net loss per common share, basic and diluted | $ 0.10 | $ 0.13 | ||
Adjustments | Subscription and Support | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | $ 1,063 | $ 2,104 | ||
Adjustments | Professional Services and Other | Adoption of New Standard | ||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||
Revenue | (562) | (1,110) | ||
Cost of revenues | $ 62 | $ 126 |
Description of Business and B30
Description of Business and Basis of Presentation - Summary of Unaudited Consolidated Statement of Cash Flows Reflecting Adoption of Topic 606 (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Operating activities: | ||
Net loss | $ (24,405) | $ (21,869) |
Accounts receivable, net | (60,004) | (54,489) |
Prepaid expenses and other assets | 1,382 | (2,035) |
Deferred commissions | (932) | (3,101) |
Deferred revenue | 30,864 | 29,639 |
Net cash used in operating activities | $ (34,428) | (39,646) |
As Previously Reported | Adoption of New Standard | ||
Operating activities: | ||
Net loss | (25,727) | |
Accounts receivable, net | (55,105) | |
Prepaid expenses and other assets | (2,280) | |
Deferred revenue | 31,257 | |
Net cash used in operating activities | (39,646) | |
Adjustments | Adoption of New Standard | ||
Operating activities: | ||
Net loss | 3,858 | |
Accounts receivable, net | 616 | |
Prepaid expenses and other assets | 245 | |
Deferred commissions | (3,101) | |
Deferred revenue | $ (1,618) |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Reconciliation of the Denominator Used in the Calculation of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Numerator: | ||||
Net loss | $ (12,538) | $ (10,268) | $ (24,405) | $ (21,869) |
Denominator: | ||||
Total weighted average common shares outstanding—basic | 34,491 | 29,090 | 33,444 | 28,909 |
Weighted average common shares outstanding-diluted | 34,491 | 29,090 | 33,444 | 28,909 |
Net loss per common share, basic and diluted | $ (0.36) | $ (0.35) | $ (0.73) | $ (0.76) |
Net Loss Per Share - Summary 32
Net Loss Per Share - Summary of Shares Excluded from Calculation of Diluted Loss Per Share with a Potential Dilutive Impact (Details) - shares shares in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 3,395 | 4,430 |
Options to Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 1,542 | 2,784 |
Common Stock Warrants | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 17 | |
Restricted Stock Units | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 1,853 | 1,629 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 45,488 | $ 38,855 |
Less accumulated depreciation and amortization | (17,941) | (14,929) |
Total | 27,547 | 23,926 |
Computer and Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 5,918 | 5,726 |
Purchased Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,071 | 1,071 |
Capitalized Software Development Costs | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 18,948 | 14,755 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 4,304 | 3,924 |
Leasehold Improvements and Other | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 15,247 | $ 13,379 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Property Plant And Equipment [Abstract] | |||||
Accumulated amortization for capitalized software development costs | $ 6,558,000 | $ 6,558,000 | $ 4,570,000 | ||
Amortization expense for capitalized software development costs | $ 1,048,000 | $ 521,000 | $ 1,988,000 | $ 1,006,000 |
Goodwill and Intangible Asset35
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 12,354 | $ 12,354 | $ 12,354 | ||
Amortization of intangible assets | $ 676 | $ 117 | $ 1,439 | $ 259 |
Goodwill and Intangible Asset36
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Dec. 31, 2017 | |
Finite Lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ (3,349) | $ (1,910) |
Total | 7,609 | 9,048 |
Domain names | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 1,268 | 1,268 |
Intangible assets, Average Remaining Useful Life | 4 months | |
Trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 120 | 120 |
Intangible assets, Average Remaining Useful Life | 0 days | |
Software | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 620 | 620 |
Intangible assets, Average Remaining Useful Life | 13 months | |
Capitalized learning content | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 400 | 400 |
Intangible assets, Average Remaining Useful Life | 40 months | |
Trade names | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 320 | 320 |
Intangible assets, Average Remaining Useful Life | 29 months | |
Developed technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 5,320 | 5,320 |
Intangible assets, Average Remaining Useful Life | 41 months | |
Customer relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 2,910 | $ 2,910 |
Intangible assets, Average Remaining Useful Life | 29 months |
Goodwill and Intangible Asset37
Goodwill and Intangible Assets - Estimated Amortization Expense (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Finite Lived Intangible Assets Net [Abstract] | ||
Remainder of 2018 | $ 1,347 | |
2,019 | 2,626 | |
2,020 | 2,386 | |
2,021 | 1,250 | |
Total | $ 7,609 | $ 9,048 |
Revenue - Schedule of Disaggreg
Revenue - Schedule of Disaggregation of Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation Of Revenue [Line Items] | ||||
Revenue | $ 50,063 | $ 38,545 | $ 98,054 | $ 73,017 |
United States | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | 40,489 | 33,172 | 79,796 | 63,726 |
Foreign | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue | $ 9,574 | $ 5,373 | $ 18,258 | $ 9,291 |
Sales Revenue | Customer Concentration Risk | Foreign | ||||
Disaggregation Of Revenue [Line Items] | ||||
Percentage of revenue generated outside of the United States | 19.00% | 14.00% | 19.00% | 13.00% |
Revenue - Additional Informatio
Revenue - Additional Information (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2018USD ($) | Jun. 30, 2018USD ($) | |
Disaggregation Of Revenue [Line Items] | ||
Revenue, remaining performance obligation expected to be recognized | $ 448 | $ 448 |
Percentage of revenue remaining performance obligation expected to be recognized | 69.00% | 69.00% |
Revenue, Remaining performance obligation period | 24 months | 24 months |
Minimum | ||
Disaggregation Of Revenue [Line Items] | ||
Percentage of revenue recognized included in deferred revenue | 80.00% | 75.00% |
Maximum | ||
Disaggregation Of Revenue [Line Items] | ||
Percentage of revenue recognized included in deferred revenue | 90.00% | 85.00% |
Deferred Commissions - Addition
Deferred Commissions - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Deferred Costs [Abstract] | |||||
Deferred commissions | $ 19,179,000 | $ 19,179,000 | $ 18,246,000 | ||
Amortization expense for deferred commissions | 2,466,000 | $ 1,701,000 | 4,544,000 | $ 3,235,000 | |
Deferred commissions impairment charges | $ 0 | $ 0 | $ 0 | $ 0 |
Marketable Securities - Summary
Marketable Securities - Summary of Major Security Type Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | $ 48,590 | $ 5,698 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (3) | (1) |
Estimated Fair Value | 48,588 | 5,697 |
Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 28,665 | 5,698 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (3) | (1) |
Estimated Fair Value | 28,662 | $ 5,697 |
Government Treasury Bills | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 19,925 | |
Gross Unrealized Gains | 1 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | $ 19,926 |
Marketable Securities - Additio
Marketable Securities - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Investments Debt And Equity Securities [Abstract] | ||
Gross realized gains or losses from sale or maturity of marketable securities | $ 0 | $ 0 |
Gross interest income on securities | 267,000 | 89,000 |
Amortization expense on securities | 16,000 | $ 8,000 |
Accretion income on securities | $ 181,000 |
Marketable Securities - Schedul
Marketable Securities - Schedule of Estimated Fair Value of Investments by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Investments Debt And Equity Securities [Abstract] | ||
Due within one year | $ 48,588 | $ 5,697 |
Total | $ 48,588 | $ 5,697 |
Stockholders' Equity (Deficit44
Stockholders' Equity (Deficit) and Stock-Based Compensation - Additional Information (Details) | Feb. 15, 2018USD ($)$ / sharesshares | Jan. 31, 2018shares | Jun. 30, 2018USD ($)VotingRightshares | Jun. 30, 2017USD ($) | Dec. 31, 2017shares |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock, authorized | 200,000,000 | 200,000,000 | |||
Common stock, Issued | 34,765,435 | 30,860,241 | |||
Common stock, outstanding | 34,765,435 | 30,860,241 | |||
Dividends paid or declared | $ | $ 0 | ||||
Common stock voting rights | Each share of common stock has the right to one vote on all matters submitted to a vote of stockholders. | ||||
Number of common stock voting rights | VotingRight | 1 | ||||
Proceeds from issuance of common stock from employee equity plans | $ | $ 7,249,000 | $ 4,316,000 | |||
Options outstanding | 1,542,000 | 2,010,000 | |||
Unrecognized stock-based compensation costs related to non-vested awards | $ | $ 5,812,000 | ||||
Weighted-average period for unrecognized compensation cost expected to be recognized | 2 years 10 months 24 days | ||||
Restricted Stock Units | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Weighted-average period for unrecognized compensation cost expected to be recognized | 3 years 1 month 6 days | ||||
Unrecognized stock-based compensation costs | $ | $ 53,895,000 | ||||
2010 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Shares available for future grants | 0 | ||||
Options outstanding | 1,085,738 | ||||
2015 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Shares available for future grants | 2,599,249 | ||||
Increase in share reserve under the plan | 1,388,709 | ||||
2014 Equity Incentive Plan | Practice XYZ, Inc. | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Shares available for future grants | 0 | ||||
Options outstanding | 1,093 | ||||
ESPP | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Shares available for future grants | 556,089 | ||||
Increase in share reserve under the plan | 308,602 | ||||
Initial offering expiration period | 27 months | ||||
Percentage of discount through payroll deductions to eligible employees to purchase common stock | 15.00% | ||||
Unrecognized stock-based compensation costs | $ | $ 1,138,000 | ||||
Weighted average date for unrecognized compensation cost to expected to be recognized | Nov. 30, 2018 | ||||
Morgan Stanley & Co. LLC and Credit Suisse Securities (USA) LLC | Underwriting Agreement | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock shares issuance and sale in public offering under the underwriting agreement | 2,500,000 | ||||
Common stock, par value | $ / shares | $ 0.0001 | ||||
Price of common stock in public offering per share | $ / shares | 39.50 | ||||
Underwriting agreement of common stock price per share | $ / shares | $ 38.315 | ||||
Common stock exercisable period for option to purchase of additional shares by underwriters | 30 days | ||||
Common stock option to purchase additional shares by underwriters | 375,000 | ||||
Proceeds from issuance of common stock from employee equity plans | $ | $ 109,800,000 |
Stockholders' Equity (Deficit45
Stockholders' Equity (Deficit) and Stock-Based Compensation - Summary of Stock-Based Compensation Expense by Award Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 5,675 | $ 4,067 | $ 10,419 | $ 7,440 |
Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 725 | 966 | 1,426 | 2,184 |
Restricted Stock Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 4,431 | 2,632 | 7,931 | 4,297 |
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 519 | $ 469 | $ 1,062 | $ 959 |
Stockholders' Equity (Deficit46
Stockholders' Equity (Deficit) and Stock-Based Compensation - Summary of Stock-Based Compensation Expense Recorded in Consolidated Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 5,675 | $ 4,067 | $ 10,419 | $ 7,440 |
Subscription and Support Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 307 | 191 | 536 | 317 |
Professional Services and Other Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 246 | 156 | 439 | 261 |
Sales and Marketing | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 1,671 | 1,195 | 3,019 | 2,150 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 2,033 | 1,506 | 3,927 | 2,738 |
General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 1,418 | $ 1,019 | $ 2,498 | $ 1,974 |
Stockholders' Equity (Deficit47
Stockholders' Equity (Deficit) and Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Shares Underlying Options, Outstanding, Beginning Balance | 2,010 | |
Shares Underlying Options, Granted | 243 | |
Shares Underlying Options, Exercised | (620) | |
Shares Underlying Options, Forfeited or Cancelled | (91) | |
Shares Underlying Options, Outstanding, Ending Balance | 1,542 | 2,010 |
Shares Underlying Options, Vested and Expected to Vest | 1,542 | |
Shares Underlying Options, Exercisable | 1,053 | |
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $ 9.09 | |
Weighted-Average Exercise Price, Granted | 34.72 | |
Weighted-Average Exercise Price, Exercised | 6.81 | |
Weighted-Average Exercise Price, Forfeited or Cancelled | 21.06 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance | 13.31 | $ 9.09 |
Weighted-Average Exercise Price, Vested and Expected to Vest | 13.31 | |
Weighted-Average Exercise Price, Exercisable | $ 8.55 | |
Weighted-Average Remaining Life, Outstanding | 6 years 9 months 18 days | 6 years 6 months |
Weighted-Average Remaining Life, Vested and Expected to Vest | 6 years 9 months 18 days | |
Weighted-Average Remaining Life, Exercisable | 6 years 1 month 6 days | |
Aggregate Intrinsic Value, Outstanding | $ 45,117 | $ 48,266 |
Aggregate Intrinsic Value, Vested and Expected to Vest | 45,117 | |
Aggregate Intrinsic Value, Exercisable | $ 35,790 |
Stockholders' Equity (Deficit48
Stockholders' Equity (Deficit) and Stock-Based Compensation - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Units shares in Thousands | 6 Months Ended |
Jun. 30, 2018$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Unvested and Outstanding, Beginning Balance | shares | 1,515 |
Shares, Granted | shares | 837 |
Shares, Vested | shares | (313) |
Shares, Cancelled | shares | (186) |
Shares, Unvested and Outstanding, Ending Balance | shares | 1,853 |
Weighted-Average Grant Date Fair Value Per Share, Unvested and Outstanding, Beginning Balance | $ / shares | $ 22.88 |
Weighted-Average Grant Date Fair Value Per Share, Granted | $ / shares | 41.70 |
Weighted-Average Grant Date Fair Value Per Share, Vested | $ / shares | 22.95 |
Weighted-Average Grant Date Fair Value Per Share, Cancelled | $ / shares | 25.96 |
Weighted-Average Grant Date Fair Value Per Share, Unvested and Outstanding, Ending Balance | $ / shares | $ 31.06 |
Fair Value of Financial Instr49
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value Disclosures [Abstract] | ||
Transfers between Level 1 and Level 2 of the fair value measurement | $ 0 | $ 0 |
Fair Value of Financial Instr50
Fair Value of Financial Instruments - Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair value measurements recurring - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | $ 80,185 | $ 19,743 |
Total liabilities | 20 | 1,286 |
Common stock warrant liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 122 | |
Contingent Liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 20 | 1,164 |
Money market funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 31,533 | 14,046 |
Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 28,726 | 5,697 |
Government Treasury Bills | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 19,926 | |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 51,459 | 14,046 |
Level 1 | Money market funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 31,533 | 14,046 |
Level 1 | Government Treasury Bills | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 19,926 | |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 28,726 | 5,697 |
Level 2 | Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 28,726 | 5,697 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 20 | 1,286 |
Level 3 | Common stock warrant liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 122 | |
Level 3 | Contingent Liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | $ 20 | $ 1,164 |
Fair Value of Financial Instr51
Fair Value of Financial Instruments - Summary of Changes in Fair Value Adjustments for Liabilities (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Fair Value Disclosures [Abstract] | |
Balance at January 1, 2018 | $ 1,286 |
Extinguishment of common stock warrants | (122) |
Change in fair value of contingent liability | (1,144) |
Balance at June 30, 2018 | $ 20 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | ||||
Rent expense under operating leases | $ 1,866,000 | $ 1,332,000 | $ 3,745,000 | $ 2,533,000 |